FOREX-Dollar declines after weak data, Swedish crown falls

NEW YORK, Oct 28 (Reuters) - The dollar fell on Tuesday on
disappointing U.S. durable goods and home price data ahead of a
Federal Reserve policy meeting.

The greenback, while weaker against most major currencies,
fared better than the Swedish crown after Sweden's central bank
surprised investors by cutting interest rates to a record low of
zero. The crown fell to a four-year low versus the dollar
.

Given recent signs of slowing in U.S. business activity and
with inflation below the Fed's 2 percent target, analysts and
traders widely expect the U.S. central bank to telegraph it
would be unlikely to raise rates before mid-2015, although it
will likely end its third round of quantitative easing.

The Federal Open Market Committee, the Fed's policy-setting
group, begins a two-day meeting on Tuesday and is scheduled to
release a statement at 2 p.m. (1800 GMT) Wednesday.

"The data definitely missed expectations, but the market is
still treading water until after the FOMC meeting," said David
Rodriguez, quantitative strategist at DailyFX in New York.

The U.S. Commerce Department said orders for big-ticket
items such as airplanes fell 1.3 percent in September following
an 18.3 percent plunge in August. Analysts had expected a 0.5
percent rise last month.

On the real estate front, S&P and Case-Shiller reported
their index of home prices in 20 U.S. cities fell 0.1 percent in
August, contrary to an expected 0.1 percent rise.

The dollar's decline was limited after the Conference Board
said its index of U.S. consumer confidence, which some analysts
see as a predictor of consumer spending, rose in October to its
highest in seven years.

The dollar index, which gauges the greenback against
a basket of six currencies, last traded 0.2 percent lower at
85.32 after touching its lowest in four sessions.

The greenback briefly turned negative against the yen on the
weaker domestic data but regained most of its earlier rise and
was last up 0.2 percent at 107.97 yen, not far from
Monday's nearly three-week peak of 108.38.

The dollar weakened against the euro, with the euro zone
currency last at $1.2747, up 0.4 percent on the day.

On the other hand, the dollar rose as high as 7.3824 crowns
, its highest since September 2010. It last traded at
7.3277 crowns, up 0.4 percent on the day.

Inflation in Sweden has undershot the Riksbank's 2-percent
target for years and despite signs the economy is picking up,
consumer prices have only risen one month so far in 2014 on an
annual basis.

Now, with the main rate cut to zero, analysts said it would
appear the Riksbank is running out of the usual tools to fight
deflation.
(Additional reporting by Anirban Nag in London; Editing by
James Dalgleish)